Web3 startups’ cap tables <a href="https://techcrunch.com/2022/04/09/crypto-cap-table-venture/?guccounter=1">can look quite different </a>from traditional ones. In addition to issuing equity as a form of incentive alignment for employees, as a typical startup would, crypto companies often also issue tokens that represent ownership. Tokens are an entirely separate asset class with their own complexities, rules and regulations.

Token management differs from equity management because of some fundamental differences between the two asset classes, Ji said. Tokens are more dynamic than equity — you can vote with them, stake them, lend them out, and provide liquidity, he continued.

Another key difference is that when traditional equity is transferred, legal papers and agreements serve the purpose of tracking ownership. In contrast, when tokens are transferred, assets move on a blockchain and a transfer of custody takes place, Ji explained. The technology needed to transfer tokens can be complex, sometimes requiring companies to write custom code.

“The same way that you would think about distributing equity to investors or employees, there’s a similar strategy that you want to apply on reserving a finite supply of tokens, and how you want to allocate them to the respective parties for the best ROI for your business,”The core product includes a dashboard where customers can see their smart contracts and tokens outstanding as well as tax compliance features. LiquiFi is also working on a product that would allow individuals with locked or vesting tokens to earn additional yield on those tokens while they’re being held

New Capability

Y Combinator alum LiquiFi raised a $5 million seed round led by Dragonfly to help crypto companies manage their cap tables

HowTo

LiquiFi is building the ‘Carta of web3’ for companies issuing tokens on the blockchain – TechCrunch

The nature of the workplace is changing thanks to evolving societal attitudes. While remote work is hogging the headlines, another revolution is taking place in workplaces: Centralization is out, and decentralized <a href="https://www.entrepreneur.com/topic/management">management</a> is in, reflecting wider technological trends. Cryptocurrencies, Decentralized Autonomous <a href="https://www.entrepreneur.com/topic/organizations">Organizations</a> (DAOs) and Web3 emphasize the benefits of a lack of centralized authority. Given the technological bent, every <a href="https://www.entrepreneur.com/topic/organization">organization</a> has these days, it makes sense to adopt these principles in workplace management as well.

Centralized Org Structures Getting Obsolete

One of the common problems executives face is a lack of flexibility in their organizations during crunch time. Typically, crises blow up to critical levels before they come to the executives' attention, at which point they must personally intervene. Ideally, crises should be nipped in the bud, and lower-level employees must deal with them proactively.

Lack Of Flexibility

A centralized organization places an enormous amount of power in the hands of a few. The organization is structured vertically, leading to lengthy decision-making chains where every decision is second-guessed. In contrast, a decentralized organization prioritizes the opinions of people closest to stakeholders and subject matter experts. This results in a flat or horizontal organization that is nimble and addresses issues quickly.

Power In The Hands Of Everyone

<a href="https://hbr.org/2017/12/when-to-decentralize-decision-making-and-when-not-to">Decentralized organizations work best when responsiveness</a> is the top priority. An organization structured in this fashion also frees up executives' time to carry out more value-added work instead of chasing fires all the time. Another benefit is that lower-level employees are empowered to think about the organization's future instead of worrying about what their manager will think. The result is a flexible organization that is future-proofed.

Being Agile

Organizations face employee churn all the time, whether due to a lack of challenging work or dissatisfaction with the company's overall direction. Both of these reasons are interconnected. An inflexible organizational hierarchy leaves employees fighting to impress their managers instead of creating revenue-generating assets.With power consolidated in the hands of a few, leadership skills are scarce. Thus, when top-level executives move on, the company faces a tough time replacing those who departed and must engage resources to locate and vet suitable leadership.

Promotes leadership skills

Promoting from within is ideal because long-term employees understand the company and its products well. They've witnessed the company's processes from the ground up, which makes them ideal leaders. However, centralized organizations don't provide low-level employees with the opportunity to ascend to leadership roles.A decentralized organization forces employees to act as leaders. Thanks to greater autonomy and priority on responsiveness, employees must act decisively. Intrapreneurship increases, promoting creativity, and the organization is energized.

Fair Promotions

Scaling a business is a tough task. Typically, a centralized organization has to design new hierarchies and determine the degree of additional responsibility existing executives will bear. All of this results in a slow-moving expansion that often stops before it begins. In contrast, a decentralized organization can respond to changing business conditions quickly and scale accordingly. Thanks to every <a href="https://www.entrepreneur.com/topic/team">team</a> and employee functioning as a separate cell, the organization can realize economies of scale and be nimble at the same time.

Easy Scalability

When expanding into a new market, a fully empowered team can research local norms and inform the broader organization of the steps it is taking to launch the company's products in that market. Thanks to the absence of lengthy approval times, the team can move quickly and establish a presence.An organization resembles a collection of well-funded startups or early-stage companies, with each team bringing its special brand of creativity and expertise to the broader community.

No Lengthy Approval Times

While <a href="https://www.entrepreneur.com/topic/decentralization">decentralization</a> emphasizes individual <a href="https://www.entrepreneur.com/topic/empowerment">empowerment</a>, executive teams also have an important role to play. In fact, executives steer the larger decentralized ship and do their best to empower their employees. Decentralization emphasizes lean management. The result is an executive team that is focused on maintaining conditions that allow lower-level employees to fully express their creativity. Lean management of this sort is not focused on establishing authority or micromanagement.

Efficient Management

Determining metrics and other performance indicators is also simple in this <a href="https://www.entrepreneur.com/topic/structure">structure</a> since executives aren't involved in every single low-level decision that has to be made. Instead, they can focus on the big picture and ensure the organization's goals are being met. The result is a happier executive team that performs a massive amount of value-added work.

Focus On The Big Picture

The flexibility inherent in the organization also allows employees to choose the work they're most passionate about instead of following a default executive career path. Thus, people who are truly passionate about becoming executives and performing the tasks inherent to these roles occupy the positions.

Do What You Love To Do

Decentralization is much more than a buzzword these days. It's the best way for organizations to structure themselves in 2022 and beyond. Given the rapid change of pace in the business world, decentralization is the best way to future-proof an organization.

The Bottom Line

A quiet revolution is taking place in the workplace right now. Here's why centralized, hierarchal corporate structures are out.

Stashed ideas

4 Reasons Decentralized Business Management Is Booming

The DAO space is evolving very quickly and we see rapid changes and evolution in how we perceive DAOs and how DAOs work. DAOs used to be universally seen as groups of very forward-thinking engineers and mathematicians working on a service or protocol that would join in the decentralisation movement. DAOs were associated with early-stage DeFi projects, open-source protocols and networks. However, the ideas imposed on DAOs have begun their evolution.

The year of the Decentralized Autonomous Organization (DAO)

DeFi revolutionised how assets could be invested and spent. DAOs are revolutionising the way that knowledge, ownership, and work is distributed globally. To put it plainly, DAOs are spreading the crypto message at speed, and this powerful knowledge is changing the lives and livelihoods of many early participants. DAOs can't exist without DeFi, and DeFi needs DAOs to bring the people.

DeFi and DAOs

The DAO revolution may seem extreme, but the same was thought about electricity, automobiles and the Internet. Talk about President Biden’s Executive Order on the “Responsible Development of Digital Assets,” and Senator Elizabeth Warren’s new proposed bill, while well-intentioned on the surface, would require the invasion of privacy of US taxpayers and mandatory self-reporting, which would be hard to enforce.

Regulators have more bark than bite

Most people think the SEC would regulate blockchain. The SEC is the most influential regulatory body in the United States when it comes to crypto, but have been very quiet as it has become obvious that they can't tame this worldwide movement. SEC Commissioner Caroline Crenshaw released a statement titled <a href="https://www.sec.gov/news/statement/crenshaw-defi-20211109">“Statement on DeFi Risks, Regulations, and Opportunities”</a> on Nov. 9, 2021. Important points are:<ul><li>decentralized projects can continue as long as no existing laws are broken;</li><li>the SEC is willing to take a passive approach and allow the industry to experiment and grow.</li><li>more transparency is needed.</li></ul>

SEC's Identity crisis

Now is a good time for the community to start discussions on improving transparency and raising trust in the DAOs. We won't need regulators to set their own terms. Instead, we must be:<ul><li>taking ownership of the responsibilities,</li><li>setting open standards to bring unity in web3,</li><li>self-regulate</li></ul>

Improving the transparency in decentralised networks

We need to set some boundaries and definitions for a DAO transparency dashboard to give the DAO value. We got this far with innovation and experimentation. There could be criminal organizations that take the form of a DAO, but web2 has shown the world the power of angry communities and their ability in taking entire organizations down. The ideal outcome is to use the power of data to make it evident whether a DAO is trustworthy.

The DAO Transparency Index & Dashboard

DAOs will be defined under similar frameworks to:<ul><li>Assign a transparency index score</li><li>Show areas in which the DAO could improve</li><li>Show the areas where the DAO is excelling.</li></ul> Transparency could consist of three principles: <ul><li>Metric A: Finance (i.e., financial health, token liquidity, revenue streams and debts, etc.)</li><li>Metric B: Governance (i.e., degree of decentralization, token holder participation, consolidation of power, smart contract execution, etc.)</li><li>Metric C: Communication (i.e., financial disclosures, internal communications, social and press/media presence, etc.).</li></ul> The DAO Transparency Index is a WIP.

Proposed transparency principles

The World Wide Web Consortium, or W3C, was founded in 1994. Thirty years later, D3C is established to assist in the new era of information. Finally, the infrastructure projects of 2017-2021 are beginning to take shape and become more usable. The three D’s represent the core components that power web3 are<ul><li>Decentralized Finance</li><li>Decentralized Organizations</li><li>Decentralized Data</li></ul>

About D3 Consortium (D3C)

Measuring a Decentralized Organization's Transparency: A Proposed Framework to Develop a Flexible Standard

The DAO Transparency Index: Measuring an Organization's Transparency & Trust

<ul><li>Large chunks of Web3 experiences are still built on open-web technologies, and you can access them through a good ol’ browser</li><li>In today's world (our not-quite-Web3 society), when we type out a website's address, we rely on our browsers to handle all the complex back-end stuff and take us to our destination in cyberspace.</li></ul>

Web3 is not as accessible or ubiquitous as it might sound

<ul>
<li>Wallet: Your cryptocurrency wallet where you store different tokens such as Bitcoin, Ethereum, and Matic</li>
<li>dApps: Decentralized applications running on blockchain-based protocols</li>
<li>Blockchain: A decentralized protocol for Web3 projects</li>
<li>Smart contracts: Snippets of programs on blockchain that execute when terms of the agreement are met</li>
<li>IPFS: The InterPlanetary File System</li>
<li>Non-custodial wallet: The service provider/browser doesn't store keys to your wallet. You have to remember your 12-word secret phrase to restore your wallet on another device.</li>
</ul>

Essential Web3 concepts

<ul>
<li>A browser is just a window to the internet. You only have to store a minimum amount of data and do minimal processing on your computer to access websites and apps</li>
<li>In 2015, the team at the Ethereum foundation tried to build a browser called Mist. It was just a shell based on Electron</li>
<li>The problem with Mist was that it was running a full node in a blockchain, so when you started the browser, it needed to synchronize all the block data that was created while you were offline.</li>
</ul>

History of browsers and Web3

<ul><li>Modern browsers are able to handle Web3 applications, but you might have to do some legwork to access them</li><li>There are a few browsers like Opera and Brave that offer a somewhat native Web3 experience with in-built wallets and Web3-based domain name support</li><li>Both of them have this experience available on mobile and desktop.</li><li>Privacy-focused Brave browser offers a slightly different experience. It doesn’t have a dedicated crypto browser or a content hub, but it has a cryptocurrency wallet.</li></ul>

The current set of browsers

<ul><li>One of the biggest challenges while accessing Web3 properties is that you should know what tokens you’re using, and what blockchain protocol a particular app runs on.</li><li>There's an issue of security as well. In Web3's nascent state, many bad actors use phishing to lure users to fraudulent websites, and steal their assets.</li><li>Brave is trying to bridge this gap by slowly integrating more standards on the browser itself, so you don’t have to worry about what's on the backend.</li></ul>

Challenges in Building for Web3

<ul><li>Accessing Web3 properties is complicated, and the average user has a steep learning curve</li><li>Modern browsers, and standards like universal profiles, will need to work in tandem to make all of this simpler</li><li>A world where a user doesn't have to worry about the backend protocol and where Web3 is just... the web</li></ul>

The Way Ahead

We are still using browsers to access different components of web3. But are they ready for the decentralized web?

What the hell is a Web3 browser? And what does it do?

From the 1980s to the early 2000s, the first era of the internet saw services built on open protocols managed by the internet community. This caused people or organisations to grow their internet presence, knowing that the rules of the game would remain unchanged. In the second era of the internet, from the mid-2000s to the present, for-profit companies built software and services that outpaced the capabilities of the open protocols, such as GAFA - Google, Apple, Facebook, Amazon. Users eventually migrated from open services to centralised services.

The first two eras of the internet

While billions of people got access to free technologies, it became more difficult for startups and creators to grow their internet presence. Centralised platforms could change the rules at any moment, taking away their audiences and profits. Centralisation could also create societal tensions. We see this in debates over fake news, state-sponsored bots, EU privacy laws, algorithmic biases.

Consequences of centralised software and services

A response to centralisation is for governments to impose regulations on large internet companies, assuming the internet is like the phone, radio, and TV networks. But, hardware-based networks of the past are fundamentally different. They are almost impossible to rearchitect. Software-based networks can be rearchitected. The internet is a software-based network with a simple core layer connecting billions of computers that can run whatever software they want. In time, core internet services will be enabled by crypto-economic networks with abilities that will exceed those of centralised services.

"Web 3": The third era of the internet

Centralised platforms have several problems:They follow a predictable life cycle and try to recruit users to make their services more valuable. Platforms are systems. When platforms move up the adoption S-curve, they grow their power over users and 3rd parties. But when they are at the top of the S-curve, they can really only grow by extracting data from users and competing with complements over audiences and profits. Over time, the best entrepreneurs, developers and investors will tire of building on top of centralised platforms.

Decentralisation is important

Cryptonetworks are built on top of the internet that<ol><li>use consensus mechanisms such as blockchains.</li><li>use Cryptocurrencies to incentivise consensus participants.</li></ol> Cryptonetworks use multiple mechanisms to ensure that they stay neutral as they grow.<ol><li>the contract between cryptonetworks and their participants is enforced in open source code.</li><li>they are kept in check through mechanisms for "voice" and "exit".</li></ol> Cryptonetworks ensure network participants band together toward a common goal - the growth of the network and regard for the token.

Cryptonetworks

Decentralized networks can win the third era of the internet just like they won the first era: because they won the hearts and minds of entrepreneurs and developers. A centralised competitor might have a better product to start with, but an active community of volunteer contributors, governed by an ehtos, will improve at a much faster rate.

Why decentralization wins 

Centralized platforms have been dominant for so long that many people have forgotten there is a better way to build internet services.

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LiquiFi is building the ‘Carta of web3’ for companies issuing tokens on the blockchain – TechCrunch

4 Reasons Decentralized Business Management Is Booming

It's time to

READ

LIKE

A PRO!

The DAO Transparency Index: Measuring an Organization's Transparency & Trust

What the hell is a Web3 browser? And what does it do?

Why Decentralization Matters

Bite-sized knowledgeto upgradeyour career

#decentralization

IDEAS ABOUT #decentralization

LiquiFi is building the ‘Carta of web3’ for companies issuing tokens on the blockchain – TechCrunch

4 Reasons Decentralized Business Management Is Booming

It's time to

READ

LIKE

A PRO!

The DAO Transparency Index: Measuring an Organization's Transparency & Trust

What the hell is a Web3 browser? And what does it do?

Why Decentralization Matters

Bite-sized knowledge
to upgrade
your career